patrick.net
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REpro
2012 Jan 30, 3:59am
Take a drive through Silicon Valley and note the number of empty commercial properties. Those businesses have moved elsewhere, and it's highly questionable whether new businesses will pick up the slack.
Vacancy in Class A offices and R&D are huge. No Nano, Bio or Solar technologies were able to take over growth of dot.com era. Now Facebook is trying to capitalize on euphoria of Wall St speculators, but they produce anything unlike Apple. Beside not many corporations flock to states sitting on stinks big debt shit.
Serpentor
2012 Jan 30, 5:40am
I think the majority of the people here agrees that if times were different. (prices are inline with income & multiples of rent, expanding local economy, and secure jobs) they would buy in a heartbeat.
The argument for the pro-buying NOW crowd doesn't take into consideration the affect of expected depreciation in home prices.
some are using the example of someone who bought 30years ago and now has a house free and clear as the reason to buy now, no matter how inflated prices are... Wrong. It was a different time back then, you can not expect what happend back then to repeat.
The argument back and forth is pretty funny because the world is not black and white. There may be some areas that make sense to buy now, and others where you are better off renting for the next 15 years.
The right answer for me is not "rent forever!" or "buy now!". its rent now and buy when it makes sense. The whole reason Patrick has the rent vs buy calculator is help you make that decision.
for me, in the short term, renting is a no-brainer for the area I live in.
If prices drop back to reasonable levels, I will buy.
If not, I will keep saving and rent. I'm not falling behind and getting "priced out" because I'm still putting away piles of cash and my investments are still keeping with or beating inflation. I'm also expecting home prices to lose ground to inflation in MY AREA. Can I be wrong, maybe, but it is a calculated risk that I've thought long and hard about. If prices never come down to where it make sense to buy, I'm ok with it, I'll retire somewhere with a pile of cash and buy in a place where it makes sense with all the cash I saved.
Anyway... my main point is that its not rent forever or buy now. Its buy when it makes sense for you. Nobody can tell you when that is except for you.
AdamCarollaFan
2012 Feb 2, 2:32am
Rent for another 3 years. You'll probably "earn" 75K a year in not-lost-equity by doing so.
good call, greggers. that's the plan.
for the past year, my roommate and i have been renting a nice 2/1.25, 1025sf apartment for $900. our lease is up, and we're renewing for 12 months @ $905. signing the lease today, yay!
bubblesitter
2012 Feb 2, 3:12am
I want to simplify - why buy when property values are not inching up in the so called desirable areas?
common! 3 years 3 months later, how did all that "don't buy it will fall another 50%" advice workout???
common @gregfielding, if I don't understand markets, explain this gem of a prediction you made 39 months ago!!!!
My investment condo is up 40% since 2 years ago and the renters are making me rich. My home is up 50k since last year.
This is a permabear site you go to when you you want others to feed your pessimism and agree with you. I advise people to do their own research and filter out those uneducated nobodies who obviously aren't investors and don't know their markets.
coriacci1
2013 Oct 23, 2:01am
just the thought of dishing over the realturds 6% commission will keep me in my lovely mission dolores rent controlled 1850sqft pad FOREVER!!!!!! ( or at least as long as I can hold on to it).
retire59
2013 Oct 23, 2:47am
I understand when some say that "no debt" is the best way...but it is all semantics instead of economics. Unless you plan to live "rent free" somehow, you have to pay for a roof over your head. So you may not be in "debt" but if you plan to not live with your parents for free or in a 'box', you still have "expenses" that must be met.
So I believe it is just a matter of semantics and not ecomonics in that you should always base your 'living' situation on what you can afford... do the math and be realistic and you will be able to decide. the Patrick.net calculator rent vs buy is a good way to start. Take care as this is a very important decision.
« First « Previous Comments 126 - 132 of 132 Search these comments
Hey guys, you helped me out a lot last year and I was able to escape from a tricky situation unscathed. I sold my 1br/1ba condo without having a short-sale on the record based on your advice.
My wife and I needed more room since we were having a baby in January, and so we're currently renting a 3br/2ba house with a pool in a great neighborhood. The rent is reasonable for what and where it is, but I still feel like I'm throwing thousands down the drain instead of building equity.
I'd like to buy a reasonable starter home in the future, and I should be able to scrape together 10% down myself, and possibly get some family assistance, depending on the total cost.
But even decent starter homes in the South Bay in good neighborhoods are $500k+, which means a 20% downpayment is $100k.
Having been burned on my condo, I'm naturally cautious. Also, I'm very comfortable in my rental, my family enjoys it, and it's in a great neighborhood I could never afford to buy into. (Rent is $2,390 a month, house appraises at $795,000 on Zillow and was appraised last year for $850,000 for refi purposes by the owner).
So how do I know when the time is right to make my move? Should I just wait until those $500-$700K suburban nearly-identical homes all through the valley drop another 10%? Should I wait until inventory is lower? Or average time on the market is lower? What do I look for?
Compounding the difficulty, we're probably going to try and have another baby in two years, which would be fine in our current house as well - but since 2 kids in day care costs more than my wife makes, our income will probably change a bit in that time frame.
Any advice is appreciated guys.